Bank of Italy: “Italians rejected on digital with regard to financial education”

The level of financial education of Italians is improving, but the gaps compared to the rest of Europe are still evident and significant. The Bank of Italy has released its latest triennial survey on the financial literacy of adults in Italy and there are surprises. Between the pandemic, war and inflation, the level has risen by 4 decimals, to 10.6 (on a scale of 0 to 20). On the other hand, digital finance skills are very bad, with a score of 4.4 out of 10. The gender gap, still high, is also bad. New initiatives to increase the skills of Italians, explained by the Bank of Italy, will come.

A small jolt that bodes well, the one highlighted by the Via Nazionale report on what our fellow citizens know about the economy and finance. In 2023, compared to 2020, “the level of financial literacy of adults in Italy, while remaining at low levels, increased slightly (from 10.2 in 2020 to 10.6 in 2023, on a scale from 0 to 20)”. The improvement is driven “by behaviors (from 4.2 to 4.6, on a scale of 0 to 9) and attitudes (from 2.0 to 2.3, on a scale of 0 to 4) in the financial field”. In the former, the management of financial resources in the short and long term is considered, while for attitudes the orientation of individuals towards savings and the shrewdness in the use of money are noted. Both these dimensions of financial literacy, explains the Bank, “are particularly important for participation in financial markets, resilience against difficulties and financial well-being”. On the other hand, the chapters relating to macroeconomic fundamentals do not improve. “The overall knowledge score, which covers concepts such as inflation, simple and compound interest rates, and risk diversification, has remained broadly flat since 2020 (from 3.9 to 3.7, on a scale of 0 to 7).” On the other hand, “the understanding of inflation and its consequences on the purchasing power of households is improving, also as a result of the sharp rise in inflation experienced in the last two years which has been accompanied by intense information and financial education activities by the Bank of Italy on this subject”.

For the first time, the survey also revealed digital finance skills. With regard to this front, the score of Italians is on average equal to 4.4 on a scale from 0 to 10. Similarly to what was observed for financial literacy, the scores are higher among those who are more educated and in the age group between 35 and 64, especially if they live in the North. There is a gender gap in the overall digital finance score that penalizes women.

Noteworthy is the segmentation of the individual factors. The indicator of knowledge in digital finance measures 1.2 on a scale from 0 to 3. Among the most interesting aspects, it is highlighted that “about 70 percent of those interviewed believe that crypto-assets have the same legal tender as money and that for 63 percent contracts concluded digitally have no legal value”. Furthermore, half of the interviewees are not aware of the fact that the online dissemination of personal information makes it possible to outline some individual preferences and personalize commercial offers”. As regards the indicator on behavior in digital finance, the score is equal to 2, on a scale from 0 to 4. Among the results it is underlined that “30 percent of the interviewees declare that they share their deposit account password with friends or disseminate information about their financial situation online”. In addition, less than 30% change their passwords regularly and just under 20% check whether financial service providers purchased online are regulated entities. Last but not least, attitudes, which achieved a score of 1.2 out of 3. “Only 32 percent of those interviewed pay attention to the security of internet sites before concluding transactions and only 40% are aware that public wi-fi networks do not guarantee security in purchases”. Not only that: “50% do not pay attention to the contractual conditions when making online purchases”. Marked gaps that can affect family and business budgets.